Recently, a growing company in Rhode Island decided it wanted to reduce the cost of its technology infrastructure by outsourcing much of its development and maintenance to China, a booming new market for IT outsourcing.

Looking for help, the company turned to the Providence office of Ciber Inc., a billion-dollar IT services and consulting company known for global outsourcing. But Ciber advised the company that outsourcing to China was not a good idea.

“They were talking about China and how to leverage China, and we were driving back thinking probably India, and then we ended by saying, ‘Probably going to be doing it here,’ ” said David Meisel, senior sales executive in Ciber’s Providence office.

Growing companies often look to outsource their IT development and support to India, China and other offshore locations as a way to reduce costs, increase functionality and speed their products and services to market.

But offshore outsourcing is not the best solution for many companies, said Thomas P. Streicher, Ciber’s vice president and area director in Rhode Island.

Companies hoping to save money by taking advantage of world-class IT talent at bargain rates overseas need a mature life cycle and very clear definitions of what they want to achieve, said Martin J. King, director of delivery in Ciber’s Providence office.

Businesses that go offshore while they are still honing their delivery models or developing new software applications with emerging technologies often find their plans to reduce headaches and save money don’t work out, he said.

“I’ve got some friends working for really large companies – industry leaders in their market segments – that were early adopters of India, where it was all about the labor arbitrage,” King said. “I had a CIO tell me five years ago, ‘I’m moving 40 percent of my software development offshore.’ Why – quality, better methodology? No, it was all about the dollar. I’m going to shave millions of dollars off my budget.”

“Alright, great, well guess what – I knew the line managers in that organization and they saw the issues,” King continued. “Guess who fixes it when it comes back from India and it’s not right – it’s your own people. So the savings that you had in the initial development, you’re blowing that on rework.”

Ciber, a Greenwood Village, Colo.-based firm with outsourcing delivery centers sprinkled throughout the United States and in 16 countries, leverages its offshore practices for clients that are a good fit. The company recently did that for a mature local franchising outfit with a set business process that was outgrowing its local data center, King said.

Ciber’s Providence office outsourced software development and the maintenance, support and monitoring of the data center to Ciber’s IT campus in India, which employees up to 700 workers, he said.

But Ciber won’t recommend India for everyone. Ciber is focused on the process rather than just getting someone offshore, and it pre-qualifies its clients to see if offshore is for them. Often, Ciber will run a pilot to evaluate if the client has a process mature and disciplined enough to benefit from offshore outsourcing, King said.

Sometimes Ciber recommends that a client with a growing business and IT needs that are in flux get its feet wet with a domestic outsourcing delivery scenario, with the possibility of experiencing greater savings through offshore outsourcing as the business plan matures, Streicher said.

“If you’re a mature organization with mature processes in terms of software development, and you have an accepting kind of culture and the culture fit is OK, and your sole goal is to reduce costs, sure – take it to India,” he said. “A lot of times people just want to start coding right away – ‘I need it now, let’s just skip that and we’ll figure it out as we go along.’ Well, you can’t really figure it out as you go along if you have your coding arm on the other side of the planet.”

Ciber’s process-focused approach to outsourcing was validated recently by The Brown-Wilson Group’s annual Black Book of Outsourcing survey, which found that CEOs, chief information officers and other business decision-makers at Fortune 2000 and Inc. 500 organizations are increasingly shifting their outsourcing strategies as a focus on client satisfaction replaces a desire for the cheapest, fastest IT performance.

The June 2007 survey, which ranked Ciber eighth among global IT outsourcing vendors, reported that vendors which ranked high in prior years for saving their clients the most money are now slipping lower, replaced by vendors that don’t always seek to move IT functions offshore.